Supplemental Poverty Measure 2013

Kathleen S. Short April 13, 2015

Thanks are extended to the many individuals who assisted in the research on developing the first supplemental poverty

measure for the U.S. The views expressed in this research, including those related to statistical, methodological, technical, or operational issues, are solely those of the authors and do not necessarily reflect the official positions or policies of the Census Bureau, or the views of other staff members. The author accepts responsibility for all errors. This paper is released to inform

interested parties of ongoing research and to encourage discussion of work in progress. This paper reports the results of research and analysis undertaken by Census Bureau staff. It has undergone more limited review than official publications.

Official Poverty Measure •Released September 16, 2014 •First adopted in 1969 •Continues under OMB Statistical Directive 14 •The 2013 official poverty rate for the nation was 14.5 percent, down from 15.0 percent in 2012. •There were 45.3 million people in poverty, not statistically different from last year.

2

Supplemental Poverty Measure (SPM)

Observations from the Interagency Technical Working Group - 2010 •Will not replace the official poverty measure •Will not be used for resource allocation or program eligibility •Census Bureau and BLS responsible for improving and updating the measure •Continued research and improvement •Based on National Academy of Sciences expert panel recommendations Measuring Poverty: A New Approach (Citro and Michael, 1995)

3

4

5

6

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

2009 2010 2011 2012 2013

Official and SPM Thresholds 2009 to 2012

Official SPM Owners with mortgages SPM Owners without mortgages SPM Renters

Source: US Bureau of Labor Statistics, Consumer Expenditure Survey, 2006 to 2014

7

8

$25,639

$21,397 $25,144

$27,600

$22,716

$27,029

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

Owner with Mortgage Owner without a Mortgage Renter

2013 SPM Poverty Thresholds

National Sacramento--Arden-Arcade--Roseville, CA Metropolitan Statistical Area

9

$25,639

$21,397 $25,144

$35,649

$28,133

$34,767

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

Owner with Mortgage Owner without a Mortgage Renter

2013 SPM Poverty Thresholds

National San Jose-Sunnyvale-Santa Clara, CA Metropolitan Statistical Area

10

$25,639

$21,397 $25,144 $25,860

$21,546 $25,357

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

Owner with Mortgage Owner without a Mortgage Renter

2013 SPM Poverty Thresholds

National CALIFORNIA Nonmetro

11

$25,639

$21,397 $25,144 $24,799

$20,832 $24,336

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

Owner with Mortgage Owner without a Mortgage Renter

2013 SPM Poverty Thresholds

National CALIFORNIA Metro

12

13

SNAP Schoollunch WIC Housing

subsidy/cap LIHEAP Ref. taxcredits +/-

Taxesbeforecredits

FICA Workexpenses Childcare MOOP

Childsupport

paid$billions 38.5 11.0 2.8 23.0 1.7 58.6 -846.0 -523.4 -240.2 -45.4 -530.9 -18.1

-900.0

-800.0

-700.0

-600.0

-500.0

-400.0

-300.0

-200.0

-100.0

0.0

100.0

200.0

Additions and Subtractions from OPM to SPM: 2013

**Includes unrelated individuals under the age of 15. Source: Current Population Survey, 2014 Annual Social and Economic Supplement.

14

SNAP Schoollunch WIC Housing

subsidy/cap LIHEAP Ref. taxcredits +/-

Taxesbeforecredits

FICA Workexpenses Childcare MOOP Child

support paid

$billions 25.2 4.2 1.2 17.3 0.9 21.0 -5.1 -10.7 -13.8 -1.7 -32.8 -1.3

-40.0

-30.0

-20.0

-10.0

0.0

10.0

20.0

30.0

Additions and Subtractions from OPM to SPM of Official Poor: 2013

**Includes unrelated individuals under the age of 15. Source: Current Population Survey, 2014 Annual Social and Economic Supplement.

15

16 16

Poverty Rates 2013 For most groups, SPM rates are higher than official poverty

rates The SPM shows lower poverty rates for

Children Individuals included in new SPM resource units Blacks Renters Individuals living outside metropolitan areas Individuals covered by only public health insurance Those with a work disability

Official and SPM poverty rates for females, people in female householder units, the native born, and those living in the South or Midwest, and those not working at least one week are not statistically different.

17

18

19

9.3 4.4

11.0 12.0

12.1 21.5

10.4

16.7

29.1

33.2

28.0

12.2

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Official** SPM

Distribution of children by ratio of income to poverty threshold: 2013

4.0 or more

2.0 to 3.99

1.5 to 1.99

1.0 to 1.49

0.5 to 1.0

less than .5

** Includes unrelated indiviuals under age 15. Source: Current Population Survey, 2014 Annual Social and Economic Supplement.

20

2.7 4.8 6.8

9.8

11.5

17.2 12.1

13.3

33.0

33.9

33.8

20.9

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Official** SPM

Distribution of people over age 64 by ratio of income to poverty thresholds: 2012

4.0 or more

2.0 to 3.99

1.5 to 1.99

1.0 to 1.49

0.5 to 1.0

less than .5

**Includes unrelated individuals under the age of 15. Source: Current Population Survey, 2014 Annual Social and Economic Supplement.

21

22

23

SPM: 2012 to 2013 In 2013 the SPM rate was 15.5 percent, an 0.5 percentage point decline

from 2012 The number poor was 48.7 million , unchanged from 2012 Between the two years, poverty rates were not different for most groups

except for --- Increases for

Those with private health insurance Decreases for

Children Those in married-couple families Hispanics Foreign born and non-citizens Renters Residing in principal cities or in the Northeast Those with public health insurance only and the uninsured

24

Interagency Technical Working Group on Developing a

Supplemental Poverty Measure (ITWG) The ITWG laid out a research agenda

As with any statistic regularly published by a Federal statistical agency, the Working Group expects that changes in this measure over time will be decided upon in a process led by research methodologists and statisticians within the Census Bureau in consultation with BLS and with other appropriate data agencies and outside experts, and will be based on solid analytical evidence.

Among the elements designated by the ITWG for further development were methods to

include noncash benefits in the thresholds improving geographic adjustments for price differences across areas improving methods to estimate work-related expenses (commuting costs) evaluating methods for subtracting MOOP expenses having to do with the

uninsured

Contact Kathleen.s.short@census.gov

26

Thank you